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Pension savings down among older women

22 July 2010 / by Lois Avery

Pension savings need to step up a gear among women over 50, according to Scottish Widows.

In their Pensions Report Scottish Widows has revealed that there has been a dramatic drop in pensions savings since last year and it is at the lowest level since 2006. The Scottish Widows Pensions Index, which tracks the percentage saving adequately for retirement, has decreased from 54 per cent in 2009 to 48 per cent in 2010 and a fifth of people who could and should are saving nothing at all.

But it was women in the over 50 age group who were found to be guilty of the worst savings habits with just 38 per cent doing enough to save to for retirement.

The insurer has now called for urgent action to help this group of savers to re-engage with their pensions.

Steve Webb MP, Minister for Pensions, said: "It is important to note that life expectancy continues to go up. We need to get the public thinking about 20 years of retirement, and not about the 5 years of retirement their grandparents might have experienced, it's particularly important that younger people understand this.

"As a Government we need to think big on pensions policy, we need to raise our eyes to the horizon or we will never get the starting point right for pensions savings. The starting point is getting the state pension right and then people can make clear choices about their own provisions for the future."

Ian Naismith, Head of Pensions Market Development at Scottish Widows said: "It is clear from our research that there is a section of the population, largely made up of women over 50, who have become disengaged from pensions and savings. They are disillusioned and are resigned to working right through their 60s and facing a large reduction in income when they retire.

“We must do everything we can to encourage them to re-engage with saving, and they must have confidence that any modest savings they can make won't simply result in a reduction to means-tested benefits.